5.1 For agencies and institutions, measuring and managing the LCC of ownership of property may directly result in improved accountability, in the form of cost savings, increased asset utilization, extended asset life, and increased mission effectiveness.

5.2 For companies, measuring and managing the LCC of ownership of property may directly result in cost savings, increased asset utilization, and, therefore, improved profit margins.

5.3 Including LCC in the three stages is consistent with Practice E2279 under the reporting principle.

1. Scope

1.1 This practice covers the establishment of a process consensus model for determining the life-cycle cost (LCC) of personal property assets owned or used by an entity.

1.1.1 For businesses, these personal property assets are required to achieve financial returns from producing and selling goods or services, or both.

1.1.2 For institutions and agencies, these personal property assets are required to accomplish their primary mission.

1.3 Asset service lives can be divided into three distinct stages, each with several separate yet interrelated substages: acquisition, utilization, and disposition. These primary stages are not intended to be all encompassing, but are offered as the basis for establishing LCC.

1.4 This standard does not purport to address all of the safety concerns, if any, associated with its use. It is the responsibility of the user of this standard to establish appropriate safety and health practices and to determine the applicability of regulatory limitations prior to use.